Stable oil prices and rhetoric from the Chinese government promising measures to boost China’s flagging economy has prompted a modest recovery in European markets on Wednesday.
China-sensitive basic resource sector led the FTSE 100 higher with Glencore (L:GLEN) top of the pile reaching a three-month high after completing the refinancing of an important credit-line.
Glencore signed new loan commitments with banks to replace an $8.45m credit facility used for financing the day-to-day business of managing its mined commodities. The refinancing is a continuation of the company’s debt-reduction plan that hopes to wipe $13bnin debt off the balance sheet by the end of the year.
The British pound bounced off its lows of the day after data showed a surprise uptick in UK earnings for the three months ending in January. While the unemployment rate remained at 5.1% when a drop to 5.0% was expected, average earnings excluding bonuses rose to 2.0% against expectation of 1.9%.
Still, the near-term fate of the pound appears still hinged on Brexit negotiations between PM David Cameron and his European peers. Critical comments from Eastern European countries including Poland over plans to curb child benefit payments to immigrants sent the pound reeling to a two-week low on Tuesday.
US markets look set for a higher open ahead of the release of FOMC minutes, which could be a little stale given Janet Yellen’s testimony already spelt out the position of the central bank relatively clearly last week.
USA pre-opening levels
S&P 500: 6 points higher at 1,901
Dow Jones: 42 points higher at 16,238
Nasdaq 100: 10 points higher at 4,114
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